Dan Rosensweig, CEO of Chegg, told CNBC on Tuesday that the education platform is focusing on international expansion this year as business continues to surge amid the coronavirus pandemic.
Last year, the Santa Clara, California-based company began investing overseas to bring the number of students who subscribe to international subscribers to service and management projects to six-digit numbers by the end of 2021.
“Over the course of the year we will have over 1 million subscribers outside the US in 190 different countries,” said Rosensweig in a “Mad Money” interview with Jim Cramer.
Among these countries, Chegg, which started out as a textbook supplier in 2005, is currently heavily represented in Canada, Australia and the UK. The company is seeing strong growth in the Middle East and Asia, but has no plans to expand into China, the world’s second largest economy.
Chegg hasn’t disclosed the number of non-U.S. Users it serves, but Rosensweig said its online program is needed worldwide as colleges, many of which closed or closed campus access in the past year, amid a global health crisis have restricted looking for ways to serve students remotely.
The company started thinking about international expansion in 2019 and predicts that the international market offers greater opportunity than what is available in the US. Some of its investments in its international services include language translation technology.
While Chegg is not currently disclosing any international revenue, the company recorded a 67% subscriber growth in 2020, reaching 6.6 million users. Total revenue, broken down into the company’s Chegg Services and Required Materials businesses, increased 57% year over year to $ 644.3 million. Revenue growth is higher than the less than 30% growth rate the company saw in the previous two years.
“What we do is something that every student around the world clearly needs, and we are proud of what we do,” said Rosensweig. “It’s exciting to see this growth.”
Based on the momentum that Chegg saw in the final quarter of 2020 and the opening quarter of 2021, the company has raised its forecasts for the current year, which will be driven by both domestic and international business.
Chegg expects total sales for this year between 780 and 790 million US dollars, which corresponds to a growth of almost 23% over the previous year in the upper price segment.
“This is the wave of the future,” said Rosensweig. “Either the institutions understand, invest in and reevaluate what they teach, how they teach, how they monitor and evaluate students, or they will lose completely.”
Chegg’s shares rose 0.34% on Tuesday to hit an all-time high of $ 102.35. The stock is up 13% since the start of the year.
Chegg more than doubled its market cap in 2020 and is currently valued by the market at $ 13.18 billion.